LISBON, Portugal--Fears over the health of Portugal's largest listed bank, Banco Espirito Santo, sent its shares into freefall Thursday, shaking stock markets in Lisbon and across Europe and even the Atlantic.

Trading was halted ahead of “important information” to be published by BES, the market regulator said.

Concerns about the lender, erupting less than two months after Portugal exited a three-year, 78-billion-euro (US$106 billion) international bailout, sent shockwaves through Lisbon and other fragile southern European markets.

Major markets across Europe also fell back, and stocks opened lower in New York as well.

Solvability Concerns

The Portuguese bank has been hit in particular by suspicion that a holding company, Espirito Santo International (ESI), covered up a 1.3 billion euro hole in the accounts.

“Investors are concerned about the solvability of BES and the impact it could have on the whole country,” said Renaud Murail, manager at France-based stock brokerage Barclays Bourse.

BES shares were suspended from trade just hours after its main shareholder Espirito Santo Financial Group voluntarily withdrew its own shares from the market, citing “difficulties” at ESI.

Espirito Santo Financial Group said it was “assessing the financial impact of its exposure” to the troubled ESI, which is under investigation by Luxembourg authorities and is reportedly seeking to restructure debts estimated at more than seven billion euros.

“No doubt BES is making the main headlines today and is widely blamed for the hefty fall in Portuguese shares and some other periphery countries like Italy and Spain,” said analyst Markus Huber at London brokerage Peregrine & Black.

“However there is nothing at this stage that would be indicating that the material irregularities which were found at ESI are extending to the entire Portuguese banking system,” he added.

Peripheral Bank Worries

Portugal's central bank, which has ordered an audit of ESI, is believed to have taken discreet action to prevent any problems from damaging the country's banking system during the eurozone's financial crisis.

Shares in Espirito Santo Financial Group have halved in value since a June 20 announcement that chief executive Ricardo Salgado will leave his job at the end of the month.

Moody's ratings agency has downgraded its outlook on the group's long-term debt to Caa2, its third-lowest rating, due to concerns about ESFG's financial position.